Planning for the Future of the Family Cottage.
With summer now in full swing, the process of opening up the family cottage in Northern Michigan is underway. This inevitably sparks thoughts of all the plans and family travel schedules for the upcoming months. But, for some, it also sparks lingering thoughts about the need to develop a plan to ensure your cottage will remain in the family for decades to come. So that feeling of excitement and anticipation for the events of the summer months and all the memories continue for future generations.
The decision to embark on succession planning for your cherished cottage is often less about financial maneuvering than it is about emotional considerations. After all, the memories made on the lake or on the banks of the river are no doubt deeply engrained in your family’s culture.
The importance of this was summed up nicely by a friend visiting a family cottage, ” The owner showed me a large oak tree in the side yard of his family’s cottage, which had a peculiar pronounced branch protruding about halfway up the trunk. A tire swing on a chain hung from the branch.”
”Through the years, the chain became embedded into the branch and my client told me that the swing had been there when he was a child and that he had played on it just as his children, grandchildren and now great-grandchildren were playing there 75 years later!”
Stories like these are not at all uncommon. Families have a unique desire to protect, preserve and plan for their family cottages.Planning for the protection and continued use and enjoyment of their family cottages by themselves and future generations is the driving force behind any cottage plan..”
The unique factors involved in a successful cottage plan often requires honest, self reflection. For example, not all families are great candidates for cottage succession planning. It may simply be that the kids don’t share the same affinity you have for your cottage. In addition, the financial means necessary to maintain a robust cottage succession plan may not exist. If this is the case, there is no point in trying to fit a square peg into a round hole.
However, when your family’s structure points to both the desire and the means to ensure continued enjoyment of the family cottage for generations to come, the legal planning to create a lasting success naturally takes on the flavor of business planning.
Beyond the final legal structure chosen to transfer the ownership of your family cottage, the nuts and bolts of business operations must also be explicitly defined. These operational considerations take the form of shared financial responsibilities, cooperation on usage for each family member and their guests as well as the legal protection of the asset against future creditors or divorce, and many more.
Thinking of exploring a plan to protect your family cottage? We can help. Call us today for a no cost- no obligation consultation to discuss your family’s cottage.
